The Libyan government appointed by the House of Representatives, led by Prime Minister Osama Hammad, has announced the launch of urgent legal and judicial proceedings against Kuwait’s Kharafi Group in connection with a long-running international arbitration dispute involving Libya.
In an official statement published on Monday, the government said it had initiated a comprehensive legal strategy after a provisional court order was issued by the North Benghazi Court, suspending the enforcement of an international arbitration ruling in favor of the Kuwaiti company.
The government said the move reflects its constitutional and legal duty to protect public funds and safeguard Libya’s financial and sovereign interests, stressing that the decision is rooted in the obligations imposed by Libya’s Constitutional Declaration and existing legislation to preserve national resources.
Allegations of Serious Violations and Corruption
According to the statement, the Kharafi Group’s investment file with the Libyan state is alleged to involve serious legal violations and invalid procedures, alongside what the government described as grave corruption cases and collusion involving parties both inside and outside Libya. These actions, it said, caused direct harm to the Libyan state.
The government revealed that new official documents, recently obtained and submitted as evidence, exposed fundamental breaches in the 2006 investment contract between Libya and the Kharafi Group. These include violations of jurisdictional rules, breaches of public order, and major flaws in the international arbitration process itself, rendering the resulting ruling legally illegitimate.
Lawsuit to Terminate the Investment Contract
The Hammad government confirmed it has filed a lawsuit seeking the termination of the investment contract, in addition to formally challenging the international arbitration ruling issued on 22 March 2013. The government said the action is intended to protect state rights and prevent the public treasury from being burdened with unlawful financial obligations.
It added that the evidence points to deliberate fraud, deception, and organized collusion, noting that the alleged actions of certain domestic parties may amount to crimes affecting national security and public funds, including charges equivalent to high treason.
Benghazi Court Suspends Enforcement of Arbitration Ruling
The government also confirmed the issuance of Provisional Order No. 339/2025 by the urgent matters circuit of the North Benghazi Court. The order, which carries immediate enforceability, suspends all procedures related to implementing the contested international arbitration ruling until the Libyan judiciary issues a final decision.
The government said the ruling underscores the authority and independence of Libya’s national judiciary and reinforces the principle that disputes involving public funds and public order remain subject to national judicial oversight, regardless of their international nature.
Government Vows Continued Legal Pursuit
In closing, the government appointed by the House of Representatives pledged to continue pursuing all available legal and judicial avenues, both domestically and internationally, to recover Libya’s full rights, hold all those involved accountable, and protect public funds without compromise, regardless of the individuals or entities concerned.
